Despite an avalanche of content flowing into the market, video game sales in the U.S. last year failed to leap ahead of last year's figures, but instead plummeted into a ravine.
That's the gloomy forecast of market research group NPD, which said sales of consoles, games and accessories last month crashed 21 percent over last December, from $5.07 billion to $3.99 billion. That contributed to an overall 8 percent drop in game sales from $18.59 to $17.02 billion.
The estimate does not include online subscriptions or game downloads.
Analysts expected better totals for games because of updates of popular franchises like Activision's first-person-shooter "Call of Duty," whose "Modern Warfare 3" became the most successful game of the year with 6 million units sold in one day, on track to be the best-selling game ever.
Other popular titles released include Bethesda Game Studios' "Elder Scrolls V: Skyrim," an action role-playing open world game, and Nintendo's "The Legend of Zelda: Skyward Sword." All those titles were released in November.
Not released, however, was an updated gaming console for any of the major platforms.
"Overall industry results are not entirely surprising given that we are on the back end of the current console lifecycle, combined with continued digital evolution of gaming," said Anita Frazier, an analyst for NPD, in a statement.
Because of the holiday shopping season, December typically accounts for a larger share of annual sales, an average of 29 percent, while this year it amounted to a measly 23 percent of the average, NPD said.
There were rumors of upgrade announcements for both Microsoft's Xbox 360 and Sony's PlayStation at this week's Consumer Electronics Show in Las Vegas that did not come to pass, with speculation now focusing on June's Electronics Entertainment Expo (known as E3) scheduled for June in Los Angeles.
Holding Out for the U?
Michael Inouye, a digital home analyst for ABI Research, said that slower game sales are likely because of two groups of Nintendo Wii users: Those who recently bought one, and those who are holding out for the Wii U, the eighth generation device unveiled at last year's E3, expected in the second half of this year.
Inouye expects 2012 to be a big year for games. "Nintendo and Microsoft still have room to grow," he said. "Motion control and voice command are really big this year and Microsoft has been spearheading that."
The challenge for Nintendo, he said, is catching up with Microsoft and Sony in its inventory of third-party developed titles for its platform rather than its own content.
Gaming wasn't the only category of electronics to suffer in 2011. NPD said overall consumer technology spending (excluding mobile phones, tablets, e-readers, and video games) fell 5.9 percent to around $9.5 billion for the five weeks ending Dec. 24, the end of the holiday spending season. But that's slightly less than 2010's 6.2 percent decline.
Posted: 2012-01-14 @ 6:56am PT
Hit titles for consoles that nobody has is not going to increase game sales. You're either developing a hit title for the 90 Million+ Wii crowd, or you're developing a beta for a secondary console that nobody is going to care about.